Statutory remission for unfit excisable goods prevails over a bond undertaking when goods deteriorate before clearance.

Where excisable goods become unfit for marketing or consumption before clearance, the second proviso to Rule 49 prevents duty from being demanded, subject only to conditions the proper officer may impose to prevent use or consumption. A manufacturer's prior bond undertaking not to claim remission cannot override this statutory relief. On those facts, molasses that had deteriorated before clearance and had been sought to be destroyed could not be subjected to duty, and the bond could not be enforced to deny the statutory benefit.

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Issues: Whether duty could be demanded on molasses that had become unfit for marketing before clearance and for which the manufacturer sought permission to destroy them, and whether the bond undertaking could override the statutory relief under the Central Excise Rules.

Analysis: The molasses had been produced and stored before the special bond undertaking not to claim remission was executed. The goods were undisputedly unfit for marketing, and the manufacturer had sought permission to destroy them. Under the second proviso to Rule 49, when goods are claimed as unfit for consumption or marketing, the proper officer may not demand duty, though conditions may be imposed to prevent their use or consumption. A contractual undertaking cannot displace the statutory remedy available under the excise law.

Conclusion: Duty could not be demanded on the deteriorated molasses, and the bond could not be enforced to deny the statutory relief.

Final Conclusion: The duty demand was unsustainable and the appeal succeeded.

Ratio Decidendi: Where excisable goods become unfit for marketing or consumption before clearance, the statutory bar against demanding duty under the second proviso to Rule 49 applies, and a prior or collateral bond cannot override that relief.

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